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Additional Homestead Exemption

A Pass Through is not a Tax Cut

This proposed constitutional amendment would increase the homestead exemption by $25,000, creating a super-exemption of $75,000 for the first $125,000 dollars of the value of homestead property for the purpose of non-school property taxes.

If approved by 60 percent of voters, it is estimated that the new homestead exemption would have a negative fiscal impact on cities, counties and special districts of $752.7 million in the first year. That impact would grow to $816.8 million by the fifth year.

The Additional Homestead Exemption amendment is nothing short of robbing Peter to pay Paul, and a Bait and Switch.

The state is offering a “tax cut” out of the pocketbooks of local communities rather than their own.

It may be called a “tax cut,” but for many it will be a “tax hike” as business owners, apartment dwellers, and others will likely pay more.

Important Points

This is a tax SHIFT not a tax CUT. The tax burden will be placed on local business owners and non-homestead property owners who must choose between more taxes or fewer services.

Small counties hit the hardest: Florida’s 29 fiscally constrained counties that are at or near the 10 mill cap will have no choice but to cut the limited services they are barely able to provide today.

Citizens will get less with less: The additional exemption means that counties that choose to maintain their current millage rates must make tough choices about the services provided to their citizens.

County by County Impacts:

The spreadsheet reflects the fiscal impact to local governments, by county, of the proposed Homestead exemption increase, updated to incorporate the 04/28/2017 Senate amendment which shifted the range from between $75k-$100k to $100k-$125k. The total impact by 2016 numbers is $587,460,139. Adjusting for inflation (using Revenue Estimating Conference numbers), this impact is projected to grow to a total in each year as follows:

2017: $603,791,531

2018: $620,516,556

2019: $637,704,865

2020: $655,305,519

2021: $673,260,891

This analysis uses the same methodology on the property tax rolls that was originally used by the Revenue Estimating conference to estimate the impact of the original proposal that exempted between $75k-$100k. It just changes the range to between $100k-$125k.

# of Homes Impacted and Individual Savings

This spreadsheet shows that 4.3 million homes receive the first Homestead exemption, but just 2.4 million would benefit from the most recent proposal. Also of note, when calculating average savings per owner, you can calculate the average per affected homeowner or all homeowners. The latest proposal would save $242.86 for the average home receiving the benefit, but save just $136.39 on average when favoring all Homestead properties including those not receiving the 3rd exemption.